A bullish mood has prevailed in the global HBI market as supply has remained very tight. A Libyan mill has opened a tender for merchant HBI, planning to sell around 40,000 mt. The bidding process continues, but some market sources expect that the producer will target and may achieve a price as high as $370/mt FOB. For now, this is just an expectation, and most buyers surveyed by SteelOrbis say they have seen almost stable price levels over the past week, but they also agree that some increase is around the corner.
Major European buyers have been receiving Libyan HBI offers (positions from traders) at $385-390/mt CFR, and they are trying to maintain this level (which has been almost stable for a month). But the targeted $370/mt FOB would translate for European buyers to $400/mt CFR and above. Market sources are waiting for the closure of the tender to see a clearer picture. “It seems demand is coming from North Africa and the Middle East, and some also from the EU,” a trader said, commenting on the rather tight HBI market conditions.
As for the Turkish market, expectations from buyers for the new offers from Libya are at $390/mt CFR at the highest, meaning that generally customers will resist the uptrend. But, on the other hand, there are almost no other options in the market. An offer for ex-Venezuela HBI has been heard at $370-375/mt CFR, but buyers are not ready to take risks and prefer to negotiate only when the cargo is on the water.
Also, there has been silence as regards ex-Russia HBI and no new deals over the past month, at least to Turkey, which is one of the major destinations for the Russian supplier. The indicative price for HBI from Russia stands at $360/mt CFR, being stable compared to early April. But unlike previous months, the mill has been inactive in pushing volumes, which may be connected with production disruptions and problems in transportation. The only HBI producer in Russia (Lebedinsky GOK owned by Metalloinvest) is located in Gubkin, Belgorod region, which is having electricity disruptions with Ukraine hitting military targets. Also, in this area, which is relatively close to the front line, Russia is using railways and trucks more for war-related transportation, causing a shortage of rolling stock for the industry.
The SteelOrbis reference price for import HBI in the Mediterranean has been stable this week at $385-395/mt CFR and will remain stable until the tender is closed.
